Although the specific breaches haven’t been disclosed, potential penalties could range from fines to sporting sanctions. These infractions have ignited significant discussion in the paddock, as teams and fans await the FIA’s decision on how to handle the violations.
“The CCA (Cost Cap Administration) confirms that although Alpine Racing SAS and HRC have both been found to be in procedural breach, neither have exceeded the Cost Cap level,” FIA said in a statement.
“Both Alpine Racing SAS and HRC have acted at all times in good faith and are currently cooperating with the CCA to finalize the matter,” they added.
The FIA has completed its review of compliance with the 2023 FIA Formula 1 Financial Regulations
Read more: https://t.co/oT168cXl7S#FIA pic.twitter.com/cNdJcL3Y6D
— FIA (@fia) September 11, 2024
The 2023 season marked the third year of cost cap restrictions for teams, with a spending limit of $138.6 million, and the first year for power unit manufacturers as Formula 1 switches to a new engine format in 2026.
Teams Exploiting the Budget Cap: A History of Overspending in F1
The F1 budget cap came into existence in the 2021 season. Red Bull Racing was the first team to be held guilty of overspending during the first trial held in 2021. The Milton Keans outfit was handed a $7 million fine while Aston Martin, who were also held guilty for minor breaches, were slashed $450,000 fine.
Though the fines were imposed, the overspenders had little to no effect on the on-track performances. Red Bull ended up notching up two straight Constructor’s titles and three Driver’s Championships, making the financial fines somewhat unpurposeful.
Following the introduction of the cost cap, it was expected that enforcing financial limits would enhance racing competitiveness, ultimately boosting viewership and generating higher revenue. However, it has seen the exact opposite effect with the average global TV viewership per Formula One Grand Prix being 70.3 million in 2021, down from 87.4 million per Grand Prix in 2020.
The reason is the financial capabilities of teams like Red Bull and Mercedes who are able to take fine after fine by breaching the limited budget while some of the lower-level teams like Williams, Sauber, and Haas not being able to afford the fines, thereby working under the prescribed budget limit.
This has created a huge gap between the so-called frontrunners and the back markers which can be seen this season with Red Bull, Ferrari, and McLaren already crossing the 400-point mark while 5 teams have even yet to reach the 3 figures this season. Out of those 5 teams, Williams is yet to make it to double figures and Sauber failing to even get on the board.
Although the cost cap has managed to curb financial overspending in specific areas of Formula 1, it has yet to address the deeper issues of genuine equity between teams that extend beyond just financial matters.
Read More: Why is Adrian Newey The Right Fit for Aston Martin?
Mohd Faisal Hakak is a sports author from Kashmir. He likes to keep tabs on the sporting world with a keen interest in football, motorsports, NBA, and other marquee sports. He is a science graduate from Islamia College Srinagar.
